Boston, MA 10/10/2013 (wallstreetpr) – The third- quarter profit percentage for Yum! Brands, Inc. (NYSE:YUM) went down by 68% due to which the company cut down its estimate for 2013 earnings. From a net income of $1 per share previous year the company reported a drop to 33 cents on every share this year. This sums to a drop from $471 million to $152 million in the net income of the company over a period of one year.
The brand’s fast food chain KFC is facing stiff competition in the markets of China, where they have more than 6000 KFC and Pizza Hut stores. The company is having a tough time in trying to expand its chain of restaurants such as Dicos and Hua Shi there. The company is also fighting hard to pull in customers after the December poultry mishap which caused the the outbreak of the avian flu. Reportedly, one of the suppliers of chicken at the stores was dealing in the raw material with too much antibiotics. This has driven away a lot of customers from the stores. In fact, sales have dropped by 11% at the brand’s restaurant chains in China. Yum is facing tough time in this scenario as it earns most of its revenue from outside of the U.S.
In this context a spokesman expresses disappointment in their efforts to bring back consumer trust in KFC. However, at the same time he points out progress, but slow. The Chief Executive Officer, David Novak is on the move to launch new campaigns and advertisements to reassure customers about the quality of food supplied in his stores. The ads will project employees at the stores as also the suppliers like poultry farmers. They will be aimed at educating people that eating properly cooked chicken is safe and will target maximum young families. At the same time, the company will be earging people to indulge in mushroom and shrimp rolls.
